Activists Urge World Bank Divestment from Private Water Companies

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Posted on 10/10/2013


ChildFund's work in countries such as Brazil has provided clean water to children.
ChildFund's work in countries such as Brazil has provided clean water to children.

Providing clean drinking water to the world's poorest countries is a major challenge. Securing adequate funding and ensuring that this money is used effectively to overcome infrastructural and logistical challenges are difficult tasks in developing nations.

Although some privately owned water companies have been instrumental in providing the world's most poverty-stricken countries with clean drinking water, Corporate Accountability International (CAI), an advocacy and awareness nonprofit organization, has called into question the efforts of other water firms, arguing that privatization of regional water supplies has kept some families from accessing the water they need to survive.

A Call to Action

In a recent report, "Shutting the Spigot on Private Water: The Case for the World Bank to Divest," CAI argues that privatized water investment by the World Bank does not extend access to deprived communities, and it hurts development of local economies and infrastructure in these regions. Women and other marginalized groups largely bear this burden, the report continues.

For more than a year, CAI has campaigned for International Finance Corp., the World Bank's financial investment arm in the private sector, to divest funding to private water companies for failing to improve access to water in poverty-stricken countries around the world.

"The World Bank Group's reputation and assets are being gambled," reads a Sept. 9 letter from CAI sent to Jim Yong Kim, president of the World Bank. "Millions of people's lives are being imperiled."

Many of the key facts highlighted in the report emphasize the need for greater action to be taken to ensure that children in need and their families can access clean, reliable sources of water. Worldwide, approximately one in eight people lack access to safe drinking water, and deaths caused by unclean water outnumber those by all forms of violence across the globe, including war. In addition, waterborne diseases pose the greatest threat to the lives of children under the age of 5, significantly outpacing deaths caused by AIDS, tuberculosis and malaria combined.

Missed Opportunities

One of the greatest challenges outlined in the report is that of infrastructure. In many countries where access to clean drinking water is a problem, CAI suggests that private water companies are doing little to invest in infrastructural projects that are vital to expanding access to water. The report states that these operations are not considered to be as profitable and that the World Bank has shifted its focus to "operational efficiency," leaving the public sector largely responsible for improving infrastructure.

Another factor highlighted in the report is the overwhelming opposition to water privatization in many countries. Although investment in private water companies represents only a small portion of the IFC's portfolio, approximately 40 percent of complaints to the IFC ombudsman are related to the practices and operations of these firms, according to CAI.

Taking Action

In many of the countries in which ChildFund operates, access to water is an urgent problem. In Brazil, for example, many families living in rural communities lack access to clean drinking water, which has serious consequences, particularly for children, who are vulnerable to disease. To address this need, ChildFund implemented its award-winning Water Watchers Program in 2001 to build dams and rainwater catchment systems to provide families with a reliable source of safe water. In addition, community members are trained in areas such as water conservation to ensure that water is being used responsibly and effectively.

"We realize that the work is hard and long, like planting little seeds that will still take time to bear fruit," says Cris, one of our child sponsors. "But therein lies the beauty of this work: When ChildFund enables the communities to identify the quality of the water, ChildFund is not doing welfare — it is helping, little by little, to create conditions for citizens to stand on their own legs to achieve dignity and a better quality of life."

To help ChildFund to provide water to children in need and their families, please consider becoming a child sponsor or making a donation to one of our special projects today.